The purpose of this highly practical, workshop is to give you a thorough introduction to and hands-on, practical experience with Excel as a financial analysis tool.
We start with a general overview of the Excel environment and its standard and add-in analysis features.
We then show how to create and analyze cash flows of basic financial instruments such as bonds and swaps, and we calculate important key ratios such as yield, duration, convexity etc.
Further, we explain and demonstrate how built-in statistical and analytical tools can be used to calculate variance, covariance, correlation etc., and how they can be used for option pricing and other interesting applications. We also explain and demonstrate how random numbers are generated and how to build up a Monte Carlo simulation. We show how risk measures such as "Value-at-Risk" can be calculated for simple positions and correlated portfolios. The "Solver" will be used to find solutions for optimizing problems (such as the mean/variance optimization), and regression analysis will be used to establish the relationship between series of financial data, e.g. in calculating "Beta" for stocks.
Finally, we give a quick introduction to Visual Basic for Applications (VBA) and show how macros can be recorded and/or individually programmed and tested to enhance the flexibility of Excel.
During the workshop, you will be programming a number of small, practical applications that you can use later. You will also design a small "program" in the Excel/VBA environment.